China's property developers expand abroad
China’s real-estate boom has been simmering away for several years now, watched enviously by estate agents all over the world.
Now the country’s developers are starting to look outside its borders. Last week, China Vanke Co Ltd, China’s largest developer by market value, hooked up with US real-estate firm Tishman Speyer Properties to jointly develop a plot of land in San Francisco, its first step into the US market.
The Shenzhen-based developer bought 70 per cent of 201 Folsom Street, a high-end residential project owned by Tishman Speyer. The project will consist of two connected residential towers – 37 and 42 storeys high – mostly aimed at rich Chinese.
The strong yuan against the dollar means Chinese investors are keen to buy. But buyers have been constrained from investing at home as the government tries to stop the market overheating. Many mainland Chinese have been looking at Hong Kong and Singapore.
Perhaps this move to the US signals an opportunity for Ireland, where commercial and high-end residential property is relatively cheap and the accounting and legal background is excellent.
Last month, Vanke linked up with New World Development Co to buy a residential site in Hong Kong for HK$3.4 billion (€330 million), its first project outside the Chinese mainland. Vanke’s move comes after Chinese property giant, Xinyuan Real Estate, took control of a site near New York’s Brooklyn waterfront for $54.2 million, which Xinyuan said was the first of its kind by a Chinese firm in the US.